Don’t Blame ETF Liquidation for Gold’s Monday Plunge

Investors in the market’s largest gold exchange-traded fund slowed their exodus out of the precious metal on Monday even as the metal dropped below $1,400 an ounce for the first time in two years.

Total assets of the SPDR Gold Trust (GLD) shed $188 million on Monday, according to State Street Global Advisors, the ETF’s sponsor. The asset declines coincided with record trading volume for the SPDR Gold fund, and compares with
an outflow of $1.2 billion on Friday.

The sharp decline in gold prices has spawned a massive flow out of ETFs tied to the physical precious metal. Created in 2004, the SPDR gold trust is among the largest and most-actively traded ETFs on the market.

So far this year, the $57 billion GLD has shed more than $15 billion in assets, a full 28% lower than where the fund started the year. The SPDR Gold Trust dropped 13% in value over the course of Friday and Monday, dropping to its lowest levels since 2011.